Bankruptcy FAQ's

Does filing for bankruptcy mean I have somehow failed?

No. There are many reasons why a person might unintentionally accumulate more debt than he or she can pay such as extraordinary medical expenses, loss of employment, even predatory high-interest loans. A fundamental goal of the federal bankruptcy laws is to give debtors a financial fresh start from burdensome debts.

Our bankruptcy team understands the many causes of unmanageable debt. We do not judge our clients. The only questions we ask about your debts are those that are important in order for us to help you solve your debt problems. On the other hand, if you want to talk about why your debts are so high, we are more than willing to listen because we know that is an important part of how we can work together to solve your issues.

Does bankruptcy offer me a fresh start?

Yes. A bankruptcy discharge releases a debtor from liability from specific debts, like credit cards, medical bills, utilities, service/repair bills, etc. and prohibits creditors from ever taking any action against the debtor to collect those debts.

Debts that are "secured" like a home mortgage or car loan, are not discharged if you keep the collateral (e.g. a house, a car). However, if you are willing to surrender the collateral, these debts can be discharged under a Chapter 7 bankruptcy. If you’ve fallen behind on your payments, Chapter 13 may be used to assist you in curing the existing arrears, while enjoying the protection of the Court’s Automatic Stay throughout the process in doing so.

Do many people file for bankruptcy ?

Yes. Nationwide over 1.1 million people filed for bankruptcy in 2012, over 1 million in 2013 and over 900,000 through September 30, 2014.

Are there ways I can manage my debts without filing for bankruptcy?

Sometimes. There are often alternatives for managing debts. The important question is what is best for you. Bankruptcy is a powerful remedy but it may not be right for everyone. Some of the alternatives to filing for bankruptcy include negotiating with each creditor, debt counselling services or a debt consolidation loan. We will discuss these with you to determine what is best for you.

Do you offer a free initial consultation about bankruptcy and debt management?

Yes. We offer a free initial consultation of up to one hour with one of the attorneys on our bankruptcy and debt management team.

How much do you charge for a bankruptcy?

Call us for a free estimate of fees.

How do I get started managing my debts?

Contact our office to arrange for a free initial consultation

We will send you a basic questionnaire about your assets, debts and income which you should complete and bring with you to the initial conference

At the initial conference:

you can any ask questions you have;

we will ask you questions about your income, assets and debts;

based on the information you provide, we will initially discuss your options and which might work best for you;

we will explain the basic process of each of the options available to you;

we will explain how we will charge you for our services after the free conference and we will provide you with a written fee agreement.

If you sign the fee agreement and elect to pay the non-refundable retainer we quote we will give you an additional questionnaire to take home, complete and return to us.

We will analyze the information you provide and recommend how best to manage your debts.

Once we have agreed upon the best plan for you, we will ask that you pay the balance of the fee we have quoted and then we will represent you and help solve your debt problems.

Are your attorneys’ fees put into writing?

Yes. You will be given a plain-language, written fee agreement explaining when and how much you must pay. Once you have read and agree to the terms of the fee agreement, then you must pay the amount specified before we will do any legal work for you.

Do I have to go to Court and will a lawyer be with me?

Yes, you will need to attend a Meeting of Creditors which is held by a bankruptcy trustee. The trustee may ask you questions about your income, property and debts. Because of the extensive preparation we do with you, you will be prepared to answer those questions. Your creditors may attend and ask you questions but rarely do. One of our bankruptcy attorneys familiar with your case will be there with you to guide you.

Are there income tax consequences if my debts are discharged or reduced?

It depends. Generally, if a creditor cancels or reduces a debt you owe, it will be considered income to you and taxable. This is not typically the case if the debt is discharged in bankruptcy . There are some other more complicated exceptions to this tax rule that might apply to your situation. We would recommend to you that you seek the advice of an accountant or other tax expert with any tax-related questions.

Will I ever be able to borrow money in the future if I file for bankruptcy?

Probably within a few years, provided that you take advantage of the benefit you receive from a bankruptcy and begin to re-establish a good credit history.

If I file for Bankruptcy, does this mean I will lose my home?

Not necessarily. Often times, people file for bankruptcy to save their home.

Does filing for bankruptcy help if my house is already in foreclosure?

Yes. Filing for Bankruptcy can stay foreclosure proceedings and even a sheriff’s sale. This stay will provide you and your attorney the time you need to decide how best to manage your debts going forward and to determine if you wish to attempt to keep the house or move to another residence.

Are Student Loans dischargeable in bankruptcy?

No. However, for people who meet very specific criteria, student loan debt may be forgiven over time.

Will I lose my car if I file for Bankruptcy?

No, as long as you have sufficient income to continue to pay for your vehicle, you will not lose your car. Even if your payments are behind and your car is threatened by repossession, a Chapter 13 bankruptcy may be used to cure the existing arrears.

Do married couples both need to file for bankruptcy?

No, but if you are living together we will need to review your spouse’s income. We will then be able to advise what is best for you.

How long does a Bankruptcy proceeding take?

For a Chapter 7 bankruptcy it will take approximately 4 months. A Chapter 13 bankruptcy lasts from 36 to 60 months to complete.

How will Bankruptcy affect my employment?

An employer is prohibited from terminating your employment based on the fact that you’ve filed for Bankruptcy relief. However, it could affect security clearances that you maintain for your employment, and, hence, affect your ability to remain employed in that position. In addition, some new employers ask about financial information on their applications for employment and it could affect whether you are hired on not, depending on the specific position you are seeking.

Can I stop Creditors from Calling Me?

You have the right to stop creditors from harassing you. We will advise you how. If you hire us, we will make sure the creditors the creditors no longer contact you.

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